PLDT, Inc. · PSE:TEL
PLDT — FY2012 Earnings Presentation
46 slides from PLDT's earnings presentation, Mar 5, 2013
Slide 1: Full Year 2012 Financial and Operating Results
Full Year 2012 Financial and Operating Results 5 March 2013
Slide 2: PLDT Group: 2012 Financial Highlights
PLDT Group: 2012 Financial Highlights FY 2012 FY 2011 % Y-o-Y ( PhP i n b i l l i o ns, excep t EB I T D A mar g i n and C o r e EPS) Total Total (Audited) Total (Audited) Service Revenues* 169.3 154.0 10% • Wireless 117.4 102.1 15% • Fix ed Line 61.3 58.8 4% • BPO** 9.9 8.6 15% EBITDA 77.3 80.0 -3%
Slide 3: Capital Management
Capital Management Dividend Declaration For the sixth consecutive year, PLDT declared 100% of core income as dividends Core earnings for 2012 P 172 per share Interim Regular Dividend (Aug 2012) P 60 per share Total dividends declared for 2012 amounted to Dividends declared (5 March 2013 P112 per
Slide 4: Subscriber Base: Cellular
Subscriber Base: Cellular Combined cellular subscribers grew by 10% or Cellular Subscribers (in millions) 6.2mn to 69.9mn as of FY12 and over 72.5mn at end of February 2013 Sun Cellular Sun Cellular subscribers stood at 15.7mn, an Red Mobile +10% 69.9 Combined increase of 1.0mn from YE11 Talk 'N
Slide 5: Subscriber Base: Broadband and Fixed Line
Subscriber Base: Broadband and Fixed Line Broadband subscribers continued to grow double- Broadband Subscribers (in thousands) digit year-on-year to reach 3.3mn at YE12 DIGITEL Postpaid broadband subscribers increased by 7% Wireless Fixed Line to 1.7mn, with each brand registering annual SMART (
Slide 6: PLDT Group: Core and Reported Net Income
PLDT Group : Core and Reported Net Income Core Net Income of P37.3bn for 2012 was 4% or P1.7bn Core Net Income (Php in billions) lower than P39.0bn in 2011, reflecting: impact of the competitive market dynamics that resulted in a sharp decline in 2H11 industry core -4% profitability, which marke
Slide 7: PLDT Group: Service Revenues and EBITDA
PLDT Group: Service Revenues and EBITDA Consolidated Service Revenues* Consolidated service revenues rose by 10% or P15.4bn (Php in billions) to P169.3bn in 2012 SMS revenues, accounting for 29% or P48.5bn of total SMS Voice - Domestic Voice - International service revenues rose by 7% from YE11
Slide 8: Service revenues and outlook per segment
Service revenues and outlook per segment Broadband service revenues grew by 26% or P4.9bn year- Broadband Service Revenues* on-year to P23.7bn in 2012, now accounting for 13% of total (Php in billions) group service revenues PLDT DSL revenues of P10.6bn were higher by 12% or Smart Broadband PLDT
Slide 9: Service revenues and outlook per segment
Service revenues and outlook per segment Wireless Service Revenues* Wireless service revenues rose by 15% or P15.4bn to (Php in billions) P117.4bn in 2012 SMART revenues were 2% or P2.4bn lower at P96.6bn Cellular Data (1) Cellular Voice Broadband Satellite and Others DIGITEL Cellular data rev
Slide 10: Capex: Unrivalled PLDT Group network
Capex: Unrivalled PLDT Group network 2011-12: Network Transformation 2013: Fortifying the network Program Completed advantage (Capex: P67bn) (Capex: P29bn) Access Network Expansion of 3G population coverage and activation 3G population coverage at 71% of more LTE sites LTE-ready: 1000 sites
Slide 11: Financial Investment in PDRs of MediaQuest
Financial Investment in PDRs of MediaQuest In May 2012, PLDT announced the financial investment by ePLDT of P6bn in Philippine Depository Receipts (PDRs) to be issued by MediaQuest MediaQuest, a wholly owned entity of the Beneficial Trust Fund, has investments in media assets that include TV5, C
Slide 12: Philippine Pay-TV Industry and Cignal Operating Highlights
Philippine Pay -TV Industry and Cignal Operating Highlights Philippine pay-TV market remains under-penetrated with just 11.3% of TV homes subscribing to cable or DTH About 18.8mn households in the Philippines, of which about 78% or 14.6mn are TV households Estimated total industry subscribers
Slide 13: PLDT Group Guidance for 2013
PLDT Group Guidance for 2013 P38.3 billion Core Net Income Core Net Inc (P1.0bn or 3% higher than 2012) Capex P29.0 Core Netbillion Income (P7.4bn or 20% lower than 2012) Capital Management Dividend Core Pay-out Policy: Net Income 70% of Core EPS + “look-back” approach 13
Slide 14: Segment and Other Details
Segment and Other Details \@PLDT smaer i
Slide 15: Broadband
Broadband Broadband service revenues grew by 26% or P4.9bn year- Broadband Service Revenues* on-year to P23.7bn in 2012, now accounting for 13% of (Php in billions) total group service revenues PLDT DSL revenues of P10.6bn were higher by 12% or DIGITEL SMART Mobile Internet P1.1bn, following a 9
Slide 16: Wireless
Wireless Wireless service revenues rose by 15% or P15.4bn to Wireless Service Revenues* P117.4bn in 2012 (Php in billions) SMART revenues were 2% or P2.4bn lower at P96.6bn Cellular data revenues of P46.0bn were stable year-on- Cellular Data (1) Cellular Voice Broadband Satellite and Others DI
Slide 17: Fixed Line
Fixed Line In 2012, fixed line service revenues grew by 4% or Fixed Line Service Revenues* P2.5bn to P61.3bn from end 2011 (Php in billions) PLDT fixed line revenues of P58.0bn were stable Local Exchange NLD ILD Data Vitro Miscellaneous DIGITEL year-on-year DSL revenues grew by 12% or P1.1bn t
Slide 18: BPO
BPO BPO service revenues for 2012 rose by P1.3bn or 15% year- BPO Service Revenues on-year to P9.9bn, accounting for 5% of total group service (Php in billions) revenues Knowledge Processing Solutions KPS grew by 15% mainly from Laserwords Private Ltd. Customer Relationship Management acquired i
Slide 19: Meralco
Meralco Consolidated revenues for 2012 rose by 11% or P28.5mn to P285.3bn driven by: Energy Sales and Revenues Increase in electricity sales volumes following increased economic activity and an (in „000 GWh and Php in Billions) expanded customer base Higher generation charges offset by lower t
Slide 20: Free Cash Flow and Capex
Free Cash Flow and Capex FCF for 2012 decreased to P37.8bn or P9.4bn from 2012, but Free Cash Flow (Php in billions) remained higher than core net income for 2012 of P37.3bn + Net cash from operations higher by P1.2bn – Capex rose by P5.2bn 2011 2012 FCF was supplemented by debt proceeds (net) o
Slide 21: PLDT Group: Debt Profile
PLDT Group: Debt Profile Debt Balance Net Debt as of FY12 stood at US$1.9bn, with Net (US$ in billions) Debt/EBITDA at 1.05x 2.7 2.9 Excluding SPi debt of US$17mn and EBITDA 2.2 2.1 1.9 1.8 1.6 1.6 1.7 As of end 2012, gross debt amounted to 1.2 1.3 1.3 0.8 0.8 US$2.9bn, inclusive of US$0.5bn o
Slide 22: Forward-looking statements
Except for historical financial and operating data and other information in respect of historical matters, the statements contained herein are “forward-looking statements” within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchang
Slide 23: Appendix
Appendix Z Ss v DIGITEL SPLOT smarr 23
Slide 24: Subscriber Data
Subscriber Data FY12 vs FY11 Net adds Dec- 12 Sept- 12 Jun- 12 Mar-12 Dec-11 Sep-11 Jun-11 Mar-11 Amount % 1Q12 2Q12 3Q12 4Q12 CELLULAR Smart 25,510,846 25,636,712 26,929,737 27,470,678 27,123,622 26,606,008 26,509,537 26,165,500 (1,612,776) -6% 347,056 (540,941) (1,293,025) (125,866) Prepaid 24,827
Slide 25: FY2012: Consolidated Financial Highlights
FY2012: Consolidated Financial Highlights FY2012 FY2011(2) Wireless Fixed Line Consolidated Consolidated % Change (1) (1) BPO Others (PhP in millions) SMART DIGITEL Total PLDT DIGITEL Total (audited) (audited) Service Revenues 96,570 20,869 117,439 57,998 3,265 61,263 9,899 - 169,331 153,958 10% Cas
Slide 26: FY2012: Consolidated Financial Highlights
FY2012: Consolidated Financial Highlights FY2010 (1) FY2011 (2) FY2012 SPi SPi SPi As Continued As Continued As Continued discontinued discontinued discontinued Released Operations Released Operations Released Operations (PhP in millions) operation operation operation Total Revenues 158,387 7,573 15
Slide 27: Reconciliation of Core and Reported Net Income
Reconciliation of Core and Reported Net Income FY2012(1) FY2011 (2) Difference (PhP in billions) Reported net income 35.5 31.7 3.8 Core net income 37.3 39.0 (1.7) (1.9) (7.3) 5.5 Accounted for by: Forex gains, net 3.2 (0.8) 4.0 Gains (losses) on derivatives (1.7) 0.6 (2.2) Asset Impairment (2.9) (8.
Slide 28: Consolidated Service Revenues
Consolidated Service Revenues 2011 (1) 2012 % Change (2) (2) (in billion pesos) 1Q 2Q 3Q (2) 4Q (3) FY (3) 1Q 2Q 3Q 4Q FY FY12 vs FY11 SMS 11.2 11.4 **10.6 12.4 45.5 12.5 12.4 11.3 12.3 48.5 7% Voice - Domestic 11.9 11.7 11.2 12.9 47.7 13.4 13.1 13.7 13.7 53.9 13% Voice - International 5.9 5.9 5.7 6
Slide 29: Revenues by Segment
Revenues by Segment FY2012 FY2011(2) Wireless Fixed Line Consolidated Consolidated % Change BPO (PhP in millions) SMART(1) DIGITEL Total PLDT (1) DIGITEL Total (audited) (audited) Service Revenues Wireless 96,570 20,869 117,439 Cellular 88,253 19,106 107,359 107,359 93,645 15% Broadband 6,749 1,763
Slide 30: Wireless Net ARPU
Wireless Net ARPU 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 Smart Postpaid 1,666 1,627 1,614 1,646 1,557 1,576 1,430 1,480 1,279 1,251 1,262 1,262 Smart Prepaid 204 197 181 189 180 179 166 166 155 150 145 154 Talk 'N Text 122 123 118 123 113 111 103 109 104 103 95 95 Red Mobile Pre
Slide 31: Expenses
Expenses FY2012 FY2011 (2) Wireless Fixed Line Consolidated Consolidated % Change BPO Others (PhP in millions) SMART(1) DIGITEL Total PLDT (1) DIGITEL Total (audited) (audited) Operating expenses Compensation and employee benefits 6,916 2,215 9,131 13,081 856 13,937 5,513 - 28,555 20,151 42% Repairs
Slide 32: Other Income (Expenses)
Other Income (Expenses) FY2012 FY2011(2) Wireless Fixed Line Consolidated Consolidated % Change BPO Others (PHP in millions) SMART(1) DIGITEL Total PLDT (1) DIGITEL Total (audited) (audited) Gains (losses) on derivative financial instruments, net 2 (53) (51) (4,098) 2,140 (1,958) 28 - (1,981) 197 -1
Slide 33: EBITDA
EBITDA FY2012 FY2011(2) Wireless Fixed Line Consolidated Consolidated % Change BPO Others (PhP in millions) SMART(1) DIGITEL Total PLDT (1) DIGITEL Total (audited) (audited) Income (loss) before tax 34,336 (1,774) 32,562 2,922 2,460 5,382 1,557 4,340 43,841 42,677 3% Add (deduct): Depreciation and a
Slide 34: Historical Consolidated EBITDA Margin (restated)
Historical Consolidated EBITDA Margin (restated) 2009 2010 2011 2012 (3) (2) (PhP in millions) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Consolidated Gross Service Revenues(1) Fixed line 12,232 12,384 12,816 12,778 12,973 11,616 12,336 12,539 12,021 12,243 12,116 12,939 13,030 12,522 12,644 13
Slide 35: Historical Wireless EBITDA Margin (restated)
Historical Wireless EBITDA Margin (restated) 2009 2010 2011 2012 (3) (2) (PhP in millions) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Wireless Gross Service Revenues(1) Cellular services 24,596 24,984 23,609 24,956 24,138 24,568 22,996 23,818 23,101 23,150 21,846 25,548 26,540 26,865 26,267 27,
Slide 36: Historical Fixed line EBITDA Margin (restated)
Historical Fixed line EBITDA Margin (restated) 2009 2010 2011 2012 (3) (2) (PhP in millions) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Fixed Line Gross Service Revenues(1) Local exchange 4,024 3,821 3,894 3,942 3,930 3,839 3,803 3,770 3,862 3,896 3,894 4,082 4,177 4,119 4,092 4,095 Internation
Slide 37: Historical BPO EBITDA Margin (restated)
Historical BPO EBITDA Margin (restated) 2009 2010 2011 2012 (PhP in millions) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q (1) BPO Gross Service Revenues Customer relationship management 913 770 791 845 774 752 626 671 670 712 726 759 777 812 826 890 Knowledge processing solutions 1,232 1,287 1,3
Slide 38: Core Net Income
Core Net Income FY2012 FY2011(2) Wireless Fixed Line Consolidated Consolidated % Change (1) BPO Others (PhP in millions) SMART DIGITEL Total PLDT (1) DIGITEL Total (audited) (audited) Reported net income 26,003 (1,541) 24,462 2,372 3,158 5,530 1,129 4,333 35,454 31,697 12% Add (deduct): Foreign exch
Slide 39: Earnings Per Share
Earnings Per Share FY2012 FY2011 (audited) (audited) Basic Diluted Basic Diluted Net income (loss) attributable to equity holders of PLDT 35,454 35,454 31,697 31,697 Continuing Operations 34,794 34,794 30,866 30,866 Discontinued Operations 660 660 831 831 Dividends on preferred shares (52) (52) (458
Slide 40: Cash Flows
Cash Flows FY2012(1) (audited) FY2011 (2) Consolidated % Change Wireless Fixed Line BPO Others Consolidated (audited) (PhP in millions) Net cash from operations 54,119 24,402 1,926 (47) 80,370 79,209 1% Add(Deduct): Capital expenditures (22,058) (13,726) (612) - (36,396) (31,207) 17% Other investing
Slide 41: Balance Sheet
Balance Sheet Consolidated December 31, 2012(1) December 31, 2011(1) (PhP in millions) (Audited) (Audited) Total Assets 410,468 399,822 Nominal Value of Total Debt 117,115 119,411 in US$ $2,851 $2,719 Less: Unamortized Debt Discount 1,323 2,136 Total Debt 115,792 117,275 Cash and short-term investme
Slide 42: Debt Profile
Debt Profile (US$ in millions) 2006 2007 2008 2009 2010 2011(1) 2012(1) Debt Balance 1,756 1,585 1,625 2,210 2,113 2,719 2,851 Cash and short-term investments 514 745 847 908 852 1,061 919 Net Debt 1,242 840 778 1,302 1,261 1,658 1,932 (1) Including Digitel Debt Maturities as of December 31, 2012 (U
Slide 43: Interest-bearing Liabilities
Interest-bearing Liabilities December 31, 2012 December 31, (Audited) 2011 Unamortized Debt Change Carrying (Audited) Discount/Debt Face Value Value Face Value (US$ in millions) Issuance Debt PLDT $1,438 $2 $1,440 $1,271 $169 Smart $928 $30 $957 $890 $67 2014 Debt $254 $26 $280 $280 $ - Others $673
Slide 44: Foreign Exchange Risk
Foreign Exchange Risk Forex Impact on Core Income Forex Impact of B/S Revaluation Forex Impact on Derivatives PLDT Group Digitel TOTAL PLDT Group Digitel TOTAL Forex sensitivity for every P1 change (in US$ Millions) Forex sensitivity for every P1 change on B/S Revaluation (in US$ Millions) Debt 947.
Slide 45: DIGITEL
DIGITEL FOR THE YEAR ENDED DECEMBER 31, 2012 Conso Elim with Impact at Wireless Fixed Line Digitel PLDTGR PLDT In million pesos REVENUES 21,351 3,265 24,616 (1,804) 22,812 Service 20,869 3,265 24,134 (1,804) 22,330 Non-Service 482 - 482 - 482 EXPENSES 23,694 3,219 26,913 (2,016) 24,897 Cash Operatin
Slide 46: BLN
BLN \Z ows = Lb YEARS